Horace Say on “I, Pin” and the international division of labor (1852)

Horace Say (1794-1860), the son of Jean-Baptiste Say, took Adam Smith’s story of a domestic pin factory which he used to explain the productivity gains from the division of labor within the factory, to an international level. He showed that there was an international division of labor which took the argument to a whole new level of sophistication and complexity:

If Adam Smith had extended his analysis, he might have shown that many other partial operations are divided among different workmen to complete that small product of human industry the value of which is so little, and which is called a pin. He might have directed attention to the work of the miner who brings to the surface of the earth the ore of copper, and to that of the miner having a different origin and habits, who, in another part of the world perhaps, has had to dig out the ore of tin necessary for alloyage and for whitening the pin. But in addition to the labor necessary to bring these metals to the requisite degree of purity, they must besides have been transported by sea and by land to the pin-maker’s manufactory. How many different operations divided among an infinite number of workmen have not been necessary in the mere construction of the ship employed in carrying the tin from a port of India to England! And what shall we say of the compass which has been used in guiding this vessel across the seas? What an amount of time and of observations of different kinds, by a great number of individuals, was necessary to put mankind in possession of the compass! The imagination is appalled at the extent of the research needed to exhibit all the labor which has been necessary to bring to perfection the most trifling product, in a single branch of any manufacturing industry of our day.

But it is especially in manufacturing industries that the division of employments has attained the most marvelous results, and that its influence is unparalleled in the increase of the values produced. Hence, the first economists who critically examined the vast mechanism of the production of wealth were struck at once with this great phenomenon.

Adam Smith says, in his “Inquiry into the Nature and Causes of the Wealth of Nations”: “The greatest improvement in the productive powers of labor, and the greater part of the skill, dexterity and judgment with which it is anywhere directed or applied, seem to have been the effects of the division of labor.” (Book i., c. 1.) And to make the full bearing of this observation understood he instances the case of the pin-maker, and shows what an immense difference there would be between the results of a man who should attempt, alone and unaided, the manufacture of pins, and those obtained in a workshop where the labor is suitably subdivided among men skilled each in a distinct branch of their manufacture. Here one draws the wire, another straightens it, a third cuts it, while a fourth points it; it is a distinct process to prepare one end to receive the head, while the head itself is the result of two or three different operations. Then the pins have to be whitened; and lastly the perforation of the paper and the wrapping up are additional and separate departments. It is thus that in the important industry of pin-making there are 18 operations, which in certain factories are the work of as many different hands. The establishment which Adam Smith visited was, as he says, small, and indifferently furnished with suitable machinery; only 10 workmen were employed, and yet it produced 48,000 pins a day, that is, an average of 4,800 apiece. In the presence of such production, and, owing to improved methods much greater to-day than when Smith wrote, how insignificant indeed would be the results of one attempting alone the manufacture of pins; scarcely would he perhaps by dint of the hardest labor make 20 in a day.

J. B. Say has taken as his example the manufacture of playing-cards, and there is no branch of industry in which immensely greater results are not obtained from the co-operation of individual effort and the division of employments.

If Adam Smith had extended his analysis, he might have shown that many other partial operations are divided among different workmen to complete that small product of human industry the value of which is so little, and which is called a pin. He might have directed attention to the work of the miner who brings to the surface of the earth the ore of copper, and to that of the miner having a different origin and habits, who, in another part of the world perhaps, has had to dig out the ore of tin necessary for alloyage and for whitening the pin. But in addition to the labor necessary to bring these metals to the requisite degree of purity, they must besides have been transported by sea and by land to the pin-maker’s manufactory. How many different operations divided among an infinite number of workmen have not been necessary in the mere construction of the ship employed in carrying the tin from a port of India to England! And what shall we say of the compass which has been used in guiding this vessel across the seas? What an amount of time and of observations of different kinds, by a great number of individuals, was necessary to put mankind in possession of the compass! The imagination is appalled at the extent of the research needed to exhibit all the labor which has been necessary to bring to perfection the most trifling product, in a single branch of any manufacturing industry of our day.

About this Quotation:

Horace Say (the son of Jean-Baptiste) takes Adam Smith’s story of the manufacture of a pin a step further in an article on “The Division of Labour" he wrote for the Dictionnaire de l’Économie politique (1852). Smith had used the story in the Wealth of Nations (1776) to illustrate his idea of the power of the division of labor to increase output in a single factory. By breaking the manufacturing process into smaller parts and having workers specialize in doing just one task instead of many tasks, the total output of the association of workers was increased dramatically. Horace Say correctly pointed out in 1852 that this idea could be extended to include the many aspects of world trade which made the work of the single factory possible: the miners in foreign countries who dug up the ore, the workers who built the ships which transported the ore to Europe, the inventors who created the compass which the ship’s captain used to navigate the ship, and so on in ever widening circles. This proved how dependent a single factory in England was on the actions and decisions of thousands, perhaps millions, of other people who were all part of the world economic system. Say concludes by saying “The imagination is appalled at the extent of the research needed to exhibit all the labor which has been necessary to bring to perfection the most trifling product, in a single branch of any manufacturing industry of our day.” Say’s story is very similar to that of Leonard Read’s “I, Pencil” which he wrote in 1958. Perhaps we should rename Horace Say’s essay “I, Pin” to make the similarity in thinking clearer.